The diagram below is a representation of the aggregate expenditure model in a hypothetical economy. If the MPC is 0.75, what is the new level of GDP when aggregate expenditures go up by two million? (give your answer in millions) A.E. 45° 2 Million 112 GDP

The diagram below is a representation of the aggregate expenditure model in a hypothetical economy. If the MPC is 0.75, what is the new level of GDP when aggregate expenditures go up by two million? (give your answer in millions) A.E. 45° 2 Million 112 GDP

ECON MACRO

5th Edition

ISBN:9781337000529

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Aggregate Demand

Section: Chapter Questions

Problem 4.8P

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Comparative Advantage and Absolute Advantage Analysis

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4
The diagram below is a representation of the aggregate expenditure model in a hypothetical economy. If the MPC is 0.75, what
is the new level of GDP when aggregate expenditures go up by two million? (give your answer in millions)
A.E.
L
2 Million
Type your answer...
112
45°
42
GDP

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